Independent Director Exam Preparation

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About Course:

I am happy to circulate this course of Practice Papers Test Series for “Independent Directors Examination”. This Test series keeping in view to cover entire syllabus for exam with major case studies.

Independent Director plays an important role in the corporate world. In the Indian corporate landscape, the role of independent directors is paramount to enhancing corporate credibility and governance standards. Independent directors hold a crucial role in balancing the interests of a company’s management and its owners. They contribute to achieving not just maximum profits but also the well-being of shareholders. The Companies Act, 2013 provides that every listed public company shall have at least one-third of the total number of directors as Independent Director in the Board. The criteria of independence have been elaborately discussed in the section 149(6) of the Act.

Ministry of Corporate Affairs, Government of India has authorized Indian Institute of Corporate Affairs notified under sub-section (1) of section 150 of the Companies Act, 2013 to create and maintain an online databank of Independent Directors under the Companies (Creation and Maintenance of Databank of Independent Directors) Rules, 2019 and the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019.

As per Section 2(47) of the Companies Act 2013, independent directors are non-executive directors who contribute to improving corporate governance. They are individuals not directly or indirectly associated with the company’s day-to-day operations.

Put simply, an independent director is like a neutral observer on a company’s board of directors. They’re not involved in the day-to-day operations or part of the company’s top management. Instead, they bring an outsider’s perspective to decision-making.

Identifying an eligible, qualified and experienced person and appointing him/her as an Independent Director in the Board is a big challenge for the companies. Section 150 of the Companies Act, 2013 has provided the manner of selection of Independent Directors and maintenance of Data Bank of Independent Directors. This Data Bank is being maintained by the Indian Institute of Corporate Affairs (IICA), New Delhi.

Any interested person, may enrol his/her candidature in that Data Bank and shall have to pass an online proficiency self-assessment test conducted by the IICA within a period of one year from the date of inclusion of his name in the data bank, failing which, his name shall stand removed from the databank of the institute. The companies having the requirement of such Independent Directors, shall pick-up the name(s) from the Data Bank, who have passed such test.

Practice Test Series Course covers the entire syllabus prescribed by the IICA for ID Exam:

Topic: Role & Responsibilities of Independent Director

Topic: Securities Laws and Regulations (SEBI Act; SEBI Regulations; SEBI Regulations; Securities Contracts; and Depositories Act)

Topic: Companies Act, 2013 and relevant Rules

Topic: Secretarial Standards

Topic: Corporate Governance & Strategy

Topic: Financial Accountancy- Understanding about Accounting standards, Balance-sheet, Profit & Loss account, Cash flow statements etc.

Topic: Basic information of major Case studies.

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